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Local SA Airlines Could Be Grounded for Non-compliance

Nationality provisions Act says that 75% of the voting rights of an airline must be held by SA residents. 

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Local SA Airlines Could Be Grounded for Non-compliance

With the news that the Air Services Licensing Council is to proceed with the case of non-compliance against local airlines, including FlySafair and Airlink, South African travelers are potentially looking at a near-collapse of domestic air travel.

If the council’s interpretation of the act is upheld by a court, this interpretation would render the majority of South Africa’s airlines non-compliant and will impact around 87% of South Africa’s domestic seat capacity.

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Gordon says “If FlySafair operations are to be interrupted on this basis then the same rule must apply to the others too. When combining Airlink, SAA and FlySafair together that equates to about 87% of the seats on the domestic market. 

“There are about 350 000 seats operated a week in SA, so that would mean about 304 000 seats would fall away. The result would be catastrophic.”

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Local SA Airlines Could Be Grounded for Non-compliance

The initial complaint put to the council by LIFT airlines, was that FlySafair was not compliant with what are called the “Nationality provisions” of the act.

The Act says that 75% of the voting rights of an airline must be held by SA residents.

This is true for FlySafair, however 50% of the voting rights are held by SA residents who are the trustees of a Trust that owns half the airline.

The council is now saying that FlySafair is non-compliant not because of foreign ownership or voting rights, but because too much of the airline is owned by companies and trusts, rather than by “natural persons”.

The nationality provisions have been a source of repeated legal contention in South African aviation.

Bryan

Person for people. Reader of writings. Writer of readings.

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